This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Business Studies Chapter 10 Financial Markets – Quiz 32 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 10 Financial Markets Quiz 32 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. A stock split is MOST likely to occur when A) A company is losing money. B) The price of a stock becomes too high. C) The stock market is doing poorly overall. D) Stockholders demand higher dividends. Show Answer Correct Answer: B) The price of a stock becomes too high. 2. Stocks or shares that are sold to investors without transacting through financial institutions are classified as A) Direct transfer. B) Indirect transfer. C) Global transfer. D) Pension transfer. Show Answer Correct Answer: A) Direct transfer. 3. One main responsibility of the stock exchange is to: A) Set company dividend policy. B) Monitor members' compliance with rules. C) Guarantee investor profits. D) Provide loans to companies. Show Answer Correct Answer: B) Monitor members' compliance with rules. 4. True or False:Stock values change daily. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 5. Physical asset markets deal with stocks, bonds, notes, mortgages and derivative securities A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: B) FALSE. 6. Explain the importance of liquidity in financial markets. A) Liquidity only affects large investors. B) Liquidity is crucial for enabling quick transactions, reducing costs, enhancing market efficiency, and stabilizing prices. C) High liquidity leads to higher transaction fees. D) Liquidity is irrelevant in volatile markets. Show Answer Correct Answer: B) Liquidity is crucial for enabling quick transactions, reducing costs, enhancing market efficiency, and stabilizing prices. 7. What is the market where newly issued securities are traded? A) Primary market. B) Secondary market. C) Over-the-counter market. D) Derivatives market. Show Answer Correct Answer: A) Primary market. 8. What is a situation in which the outcome is not certain, but the probabilities can be estimated? A) Risk. B) Savings. C) Equities. D) Bond. Show Answer Correct Answer: A) Risk. 9. SEBI has introduced the Additional Surveillance Mechanism(ASM) for the stocks that were showing extra ordinary price swings. Stocks under this mechanism will be subject to 5% price filters i.e if the stock moves up or down 5%, trading activity in the stock will be halted for the rest of the session. A) Development function. B) Protective function. C) Regulatory function. D) None of the above. Show Answer Correct Answer: C) Regulatory function. 10. One of the financial institutions that operates by collecting premiums from clients is called ..... A) Brokerage. B) Credit union. C) Investment banks. D) Insurance companies. Show Answer Correct Answer: D) Insurance companies. 11. In the capital market, what is typically traded? A) Currency and foreign exchange. B) Stocks, bonds, and derivatives. C) Real estate and commodities. D) Mutual funds and ETFs. Show Answer Correct Answer: B) Stocks, bonds, and derivatives. 12. What is the role of a stock exchange? A) To provide medical services. B) To offer legal advice. C) To sell groceries. D) To provide a platform for buying and selling securities. Show Answer Correct Answer: D) To provide a platform for buying and selling securities. 13. What kind of relationship exists between the depositor and the bank? A) Creditor-debtor. B) Financial. C) Depository. D) Bailor-bailee. Show Answer Correct Answer: A) Creditor-debtor. 14. The following are barriers to global integration EXCEPT A) Excessive cost of executing international transactions. B) Different accounting regulation. C) Lack of information about foreign companies. D) Price changes in response to supply and demand. Show Answer Correct Answer: D) Price changes in response to supply and demand. 15. Debt Markets are regulated by A) SEBI. B) RBI. C) RBI and SEBI. D) IRDA. Show Answer Correct Answer: C) RBI and SEBI. 16. A nonprofit service that accepts deposits, makes loans, and provides other financial services is known as a A) Bank. B) Credit Union. C) Stockbroker. D) Life Insurance Company. Show Answer Correct Answer: B) Credit Union. 17. When a company declares bankruptcy, who is paid 1st? A) The CEO. B) The lowest-paid workers. C) The company's bond holders. D) The company's shareholders. Show Answer Correct Answer: C) The company's bond holders. 18. Tax rate applicable to Individual investor who invest in other than equity oriented fund and holding period is more than 36 months A) 20% ( With Indexation ). B) 20% ( Without Indexation ). C) 10% ( With Indexation ). D) As per tax slab. Show Answer Correct Answer: A) 20% ( With Indexation ). 19. Which securities amongst these have proved to be a better bet against inflation? A) Debentures. B) Bank Deposit. C) Fixed Deposit. D) Equity. E) Not Attempted. Show Answer Correct Answer: D) Equity. 20. What is the equation for the Quantity Theory of Money? A) QV=PM. B) MV=PT. C) XM=PY. D) XY=ZY. Show Answer Correct Answer: B) MV=PT. 21. What is an Indian depository receipt? A) A deposit account with a public sector bank. B) It is a depository account with any of the depositories in India. C) An instrument in the form of depository receipt created by an Indian depository against underlying equity shares of the issuing company. D) It is an instrument in the form of deposit receipt issued by Indian depositories. Show Answer Correct Answer: A) A deposit account with a public sector bank. 22. The most important characteristic of money for determining its value is A) Durability. B) How limited it is in supply. C) Homogeneity. D) Portability. Show Answer Correct Answer: B) How limited it is in supply. 23. A bond purchased at 7% yield becomes more attractive when? A) Interest rate drops to 6%. B) Interest rate rises to 8%. C) Repo rate increases. D) None of the above. Show Answer Correct Answer: A) Interest rate drops to 6%. 24. Money market deals in ..... A) Medium-term securities. B) Short term Securities. C) Long term Securities. D) None of these. Show Answer Correct Answer: B) Short term Securities. 25. Sistem yang mengalokasikan sumber daya keuangan dalam bentuk hutang dan ekuitas sesuai dengan penggunaannya yang paling efisien adalah ..... A) Keuntungan pasar modal. B) Tujuan pasar modal. C) Definisi pasar modal. D) Bentuk pasar modal. Show Answer Correct Answer: C) Definisi pasar modal. ← PreviousNext →Related QuizzesClass 12 Business Studies Chapter 10 Financial Markets Quiz 1Class 12 Business Studies Chapter 10 Financial Markets Quiz 2Class 12 Business Studies Chapter 10 Financial Markets Quiz 3Class 12 Business Studies Chapter 10 Financial Markets Quiz 4Class 12 Business Studies Chapter 10 Financial Markets Quiz 5Class 12 Business Studies Chapter 10 Financial Markets Quiz 6Class 12 Business Studies Chapter 10 Financial Markets Quiz 7Class 12 Business Studies Chapter 10 Financial Markets Quiz 8Class 12 Business Studies Chapter 10 Financial Markets Quiz 9Class 12 Business Studies Chapter 10 Financial Markets Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books